Obama, EU Leaders Make TTIP Push as "Brexit" Debate Escalates

US President Barack Obama met with a series of EU national leaders over the past week to call publicly for negotiations on the Transatlantic Trade and Investment Partnership (TTIP) to speed up in the coming months, particularly given his limited time left in office.

The leaders’ meetings came as the latest series of TTIP negotiations were about to begin, with the thirteenth round being held in New York from 25-29 April.

“[The trade deal is] important for the German economy; it’s important for the whole of the European economy,” said German Chancellor Angela Merkel on Sunday during a joint press conference with Obama. “And if I look at the progress that was made with [the Trans-Pacific Partnership], I think we all ought to have an interest in speeding matters up.”

Obama, for his part, added that while he does not expect TTIP to be ratified this year, he does expect the talks themselves to be finalised. “[At] that point, we will have the negotiations completed and people will be able to see exactly why this would be good,” he said.

The statements in Germany were made shortly after Obama visited another EU member state – the United Kingdom – and similarly paired up with Prime Minister David Cameron to stress the importance of the trade deal, as well as the risks to the UK should it opt out of the European Union.

Timing

The TTIP talks were launched nearly three years ago to much fanfare, with both sides stressing the value in both economic and geopolitical terms in strengthening the world’s most robust trading relationship. The goal would be to lower market access barriers across the Atlantic, while also working to find areas to cooperate on each sides’ regulatory processes in areas ranging from textiles to chemicals. (See Bridges Weekly, 20 June 2013)

The years since, however, have seen the talks struggle to make major progress, despite 12 rounds of talks, several high-level “political stocktaking” meetings between top trade officials, and repeated pledges at the leaders’ level that the negotiations remain a high priority.

Meanwhile, the pact has drawn harsh criticism from some parts of the public, especially in Europe, over concerns that efforts to improve regulatory cooperation could limit domestic governments’ role in adopting policies in the public interest – despite trade officials’ assurances to the contrary.

The worrisome state of the global economy, as well as the impending leadership changes in Washington, have raised the stakes for the trade deal. Indeed, as the clock winds down on the US leader’s time in office, Obama has been pushing to advance a series of priority policy areas, including on trade.

Obama is due to leave the White House on 20 January 2017, with his successor to be elected in early November of this year. However, the expected outcome of the US election is anything but clear at this stage, with the two main political parties still to confirm their respective nominees for the November polls.

The process has reignited an already-fraught public debate over the possible merits and pitfalls of international trade deals, particularly given the parallel push by the Obama Administration for the US Congress to ratify the Trans-Pacific Partnership (TPP) deal this year. (See Bridges Weekly, 7 April 2016)

“During presidential elections, it’s always tough,” Obama said in Hannover on Sunday. “When we’re in the heat of campaigns, people naturally are going to worry more about what’s lost than what’s gained with respect to trade agreements.”

“Brexit” referendum approaching

The fate of the UK’s membership in the European Union also dominated headlines during the US President’s visit to the bloc, with Obama publicly entering the fray to argue against a so-called Brexit.

In an op-ed published ahead of his visit by The Telegraph, a UK-based newspaper, Obama warned about the dangers of a UK exit from the European Union, while acknowledging that the decision “is a matter for British voters to decide for yourselves.”

Speaking “with the candour of a friend,” he said that the outcome of the 23 June vote is a subject deeply important to Washington, arguing that the UK’s role as a global leader is enhanced by being part of a “strong Europe,” one that actually increases London’s influence.

Examples of this, Obama added, range from international leadership on climate change to the benefits to the UK of being part of the EU’s single market and a player in the 28-nation bloc’s trade negotiations with third countries, such as the US.

“When it comes to creating jobs, trade, and economic growth in line with our values, the UK has benefited from its membership in the EU – inside a single market that provides enormous opportunities for the British people,” he said.

“And the Transatlantic Trade and Investment Partnership with the EU will advance our values and our interests, and establish the high-standard, pro-worker rules for trade and commerce in the 21st century economy,” Obama continued.

Though the comments were welcomed by Cameron and other politicians in favour of the UK continuing in the EU, campaigners supporting a “Brexit” lambasted the US leader’s remarks, with some arguing that Washington would never cede its own sovereignty in that way.

A report published by HM Treasury earlier this month said that a vote in favour of a UK exit would leave the country “permanently poorer,” analysing alternatives that included either a Norway-style membership of the European Economic Area; a Swiss-style bilateral pact; or just being a fellow WTO member without a specific trade deal with the EU.

Obama: UK-US trade deal would not happen “anytime soon”

Should UK voters decide in June against staying in the European Union, they would also not be assured of a trade deal with the US in the near-term – contrary to what some pro-Brexit campaigners argue – according to Obama.

“I think it’s fair to say that maybe some point down the line, there might be a UK-US trade agreement, but it’s not going to happen anytime soon, because our focus is in negotiating with a big bloc, the European Union, to get a trade agreement done, and the UK is going to be in the back of the queue,” said the US leader in a joint press conference with Cameron last Friday.

Obama explained that Washington prefers negotiating with several countries to have access to larger markets, such as the TTIP with the 28-nation EU, rather than pursuing “piecemeal” pacts, which he suggested were “hugely inefficient” as a strategy.

The US leader’s remarks echo the warnings raised by his top trade negotiator, US Trade Representative Michael Froman, who has regularly said that Washington is not interested in trade deals with individual countries. (See Bridges Weekly, 24 March 2016)

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